Tag Archives: microsoft

When a 6 year old reacts to your brand by saying “old Nokia, that’s bad [as a choice of phone]” you should know you’re in a lot of trouble.

I believe in Capitalism

I believe in Capitalism mainly because at a simple level, it prevents a lot of wars (you can’t fight people you want to sell to and make money from). That’s a good a good thing of course; but many parts of entirely unrestrained capitalism are bad.

By un-restrained I mean profit generation devoid of other considerations: social impact, ecological, moral (etc) and the obsessive chasing of that profit.

What’s this have to do with a mobile phone brand which is perceived as irrelevant by children?

Slavery to the stock market (or your shareholders) via quarterly reports builds companies which do not perform as well as they could. This short termism, is actually the opposite trait needed by a business which wants to become a dominant global player or a brand loved – ultimately irrationally – by it’s customers. A lovemark.

Failure to see inevitable changes on the horizon (even by previously innovative brands) seems to be rife in the corporate world. The mobile and technology industry is no exception.

Blinkered In The Boardroom

I believe much of this stems from the board room, where quarterly figures – and bonuses for those C-level staff – usually get top priority. Why else would once innovating start-ups become rigid behemoths?

Protecting the share price is the remit of a traditional corporate CEO, no responding instead to the market changes and customer’s demands (and I mean the customer who is your market, not the stock market). Arguably, Nokia’s brand is failing for lack of responding to customer’s wants and needs.

Long before the iPhone was released, the Nokia N95 promised a revolution; but was too slow, too hard to use and without interesting applications. It was an evolution of every previous model, not a revolution.

Revolutions are not popular with shareholders, because revolutions create uncertainty. We all know you can’t have innovation without risk taking, an element of uncertainty and a healthy dose of revolution to create the next big thing.

Yet even today, Nokia still remains with it’s head in the sand – delusional even – about the realities in the market place. The new CEO preaches to the stock market, desperately trying to halt a further share price fall, instead of taking the drastic steps required to revolutionise the business.

When a child of 6 is saying:

“Quite old, 90 or something” or “My grandma has one”

and when 20-somethings are saying:

“It was cool when I was 14” or “it used to be good”

..that is who you should be listening to, not the stock market.

Children on the BBC's "Secrets of Superbrands" being asked what phones (thus brands) they think are good. Click to find this on BBC's iPlayer.

In fact, screw the stock market. An obvious and understandable course of action is the last thing you need to be doing. Unless shareholders are panicking about your change of course, you’re probably not doing enough to have any hope of getting your company back in the game, let alone leading it.

Other brands also struggle to escape their corporate stagnation.

Asked on the BBC’s recent Secrets of Superbrands documentary “if Microsoft were a person who would they be?” a 20-something replied:

“They would be old”

Another said

“Microsoft is like someone who has been divorced recently; settled down and is dull; but then is thrust out into the world after their divorce and has to pretend to be young again”

As the program suggests, they’ve even had to hide their brand from some, asked “Who makes Xbox”? the response from Xbox owners was “errr, dunno”. Presumably this is also why Microsoft created “Bing” and not “Microsoft Search”.

A fallorn looking Bill Gates during the 90's monopoly hearings. He's now long gone as CEO, instead doing great things for the world with his Foundation; but has Microsoft got the right stuff to be relevant in 20 years? Shareholders today probably don't care.

You Can Run But You Can’t Hide

I believe that running away from the inevitable will simply persist an enevitable decline. You need to fight it head-on . Microsoft should have called it “Microsoft Search” and then focused efforts on changing the entire core brand perception – instead of diluting efforts into a new brand Bing which won’t feed into the street-cred of other parts of the same company.

Sony was described as a “Middle class” person … “like all the other bank workers” or “a reliable elder statesman”. Probably not the vision of a cutting-edge technology brand they’d prefer.

The reasons for these brand perceptions are complex and multiple; but business is driven from the top – by the CEO. The leader. The board.

They are the ones responsible for authorising and enabling radical change or at least, aggressive evolution.

“the type of person who invites you to their birthday party, but they you have to do exactly what they want to do all evening”.

Personality is important for leadership and for the brand. In Apple’s case, that’s Steve Jobs.

Steve Jobs's Apple was compared to a religion. It does, however, seem to be led by someone who believes in giving customers what they want, not what the stock market expects or demands

Listening to the stock market on a monthly – if not daily – basis might mean the CEO get’s his yearly bonus and makes the company look wonderfully successful short term …but only right up until it falls over a cliff into free-fall decline.

SME’s are not allowed to get away with such accounting hijinx, it seems so wrong that the corporates are – and everyone goes along with it (the Morgan Stanleys, the Goldman Sachs’s) because they have a vested interest. It’s all a big game for the major stakeholders and those taking these giants to IPO.

What I will highlight is an important subtlety which strategically may be significant to Microsoft going forward but which I’ve not yet heard mentioned.

The world of social media has accelerated the blurring of lines between work and play, enterprise and home, business and personal.

Microsoft continues to take the bulk of it’s revenue from traditional enterprise software sales while it sinks millions into trying to keep pace with the future: mobile phone and internet, social (that wonderfully woolly catch-all) and Enterprise 2.0 (much as I hate that term).

LinkedIn and Facebook, plus the up and comings like Twitter and Huddle, are proof that the business world is in mid-collision with the personal web. Functionality like “Chatter” in Salesforce, and social CRM systems are the tip of the iceberg.

It is becoming harder and harder NOT to do business, or as a customer engage with brands, on the services which until recently were reserved for friends and personal pleasure.

Aside from MSOffice and possibly Bing search, Microsoft’s services remain pretty siloed. It’s Outlook and Exchange in the workplace and Hotmail at home.

MSN Messenger is not, generally, used in the office. Microsoft Windows Phones used to be a business device, but they took so long catching up many companies have switched to Apple iPhone or remain with RIM’s Blackberry.

Skype in contrast is a hybrid – one of the few big 2.0 web companies whose brand neatly straddles work and play. It is inherently social and is “acceptable” to use it in a business or corporate setting as much as if sitting at home on the sofa.

More and more services and brands will occupy this mongrel position of being cross-over brands especially as everything becomes mobile.

Happy Happy Joy Joy. Well, for now.

Are we really going to be carrying TWO mobile devices (one for work and one for home) in 2015? I doubt it. Blackberry have already begun to attend to this issue with their new O/S 7.0 devices due this Summer; it remains to be seen how successfully they’ll be aiding that separation on one handset.

People talk about the corporate bureaucracy at Microsoft (and I’m sure it’s there) but as the old guard inevitably rotate out, change must be making root and spreading fast.

Microsoft remains on the back foot with Windows Phone 7.0 but they have a large war-chest of cash to play with – and a few more ballsey acquisitions of hybrid cross-over companies like Skype might be just what they need to keep pace.

Alternatively, the usual problems with integrating two very different companies, may just make the thing a premature Christmas turkey purchase.